Today we are adding a bonus article with analysis on the XAUUSD crash and fall. Hope you will join it. All the shares and likes are greatly appreciated and we thank you for that. Also, please feel free to write a comment down below. I always appreciate that as well so much.
The most noticeable fall of yesterday, for me, was the fall of XAUUSD below 1250. This 1250 price level has been my long-term target ever since Gold topped out and made a sharp reversal.
I spoke about Gold in yesterday’s daily video analysis in amazement. Why? Gold reaching 1250 was for me a moment of triumph.
One reason is because I made good trades by shorting Gold the last 6 months. Trades I often mentioned in this article so hope you were able to catch a few pips as well.
But the other reason is also definitely connected to the long term prediction of XAUUSD falling to 1250 ever since the first crash of gold off the September 2011 highs of 1920 dollars and the subsequent crash between 23rd and 27th of September 2011 from 1850ish to 1550ish levels. This is the same as the AUDUSD crash prediction mentioned in the WET blog on April the 18th. I like it when these predictions come true, although I did not have the staying power nor capital to actually hold a trade from 1750 to 1250, it still allowed me to catch downside trades on the crash down
LOW NOT YET IN SIGHT
Anyhow, 1250 at the moment does not seem the lowest point. There is some space and potential for more downside. Since the biggest and most impulsive fall during mid April when Gold crashed 250 dollars in 2 days, we are able to measure that XAUUSD most likely will break the bottom 2 more times. This is based on the Elliott Wave Theory by the way. We have one bottom break completed already. And if my count is correct, the minimum what we can expect is eventually this move down to stop, start making a bear flag correction, and then the subsequent break of that flag for one more downside to the next -618 target.
Logically speaking any retracement would find natural resistance at the broken bottoms. Although the price might not even reach those levels before the next fall. This will heavily depend on how price corrects to the upside once the current downside power ebbs away. Once the price bottoms out and makes a correction, especially if its a bear flag as mentioned above, then a slow grinding movement yet again to the 382 or 500 Fib of the most recent fall is a likely scenario. These levels tie in together with the broken bottom levels. A turn at these levels for 1 more break of the bottom is then very likely.
A move down could easily see XAUUSD fall to the -0,272 target at 1165 or the -0,618 target at 1095. Another way of counting the target is by measuring the internal waves of the 5th wave (purple). There are currently 3 waves and the 5th wave (of this 5th wave), is usually equal in length to wave 1 but should usually not be longer than wave 3.
Wave 1 is 150 dollars and wave 3 is currently 200 dollars, although wave 3 has not finished yet and still might push lower. One way of measuring the future target is my substracting 150 and 200 (or the new difference the current bottom at 1220 is broken) from the 382 or 500 Fib turning spot. At the moment this would mean a target area of 1100 or 1200, depending on which scenario unfolds.
If you need extra clarification on how to calculate these targets, please let me down below in the comment section? Thanks!!!
Also, the 500 Fib of the grand up trend cycle is on my chart at 1090. Could 1090 be THE spot for XAUUSD to resume its grand cycle to the upside? Could XAUUSD bounce off that 1090 level and then slowly but surely climb to 2200? Could this be the grand reversal for XAUUSD? I think it could. The 500 Fib would be a great spot for such a thing to happen. So may bet is that 1090 will be the low for Gold after which XAUUSD will see upside. Lets see if this prediction comes true as well… only time will tell!
Here are some great articles by the way you want to check out:
Thanks for reading and sharing this article!!! Good Trading!!!
Winner’s Edge Trading, as seen on: